Integrating Global Mobility and Global Talent Management: Exploring the Challenges and Strategic Opportunities

Please cite as

Collings, D.G. (2014) “Integrating global mobility and global talent management:

exploring the challenges and strategic opportunities’, Journal of World Business, 49:

2, 253–261. DOI: 10.1016/j.jwb.2013.11.009

Dr David G. Collings

Professor of HRM

DCU Business School

Dublin City University

Dublin 9

Ireland

Tel. + 3531 7006937

Email. david.collings@dcu.ie

Integrating Global Mobility and Global Talent Management: Exploring the

Challenges and Strategic Opportunities

Abstract

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Although global mobility represents an important element of many multinational

enterprise’s (MNEs) global talent management systems, the two areas of practice

have largely been decoupled in research and practice. The current paper aims to build

a dialog around the integration of these two important areas of practice and illustrate

how the integration of global mobility and global talent management can contribute to

the success of the MNE. Human capital and social capital theories are introduced as

theoretical frames for the integration of the two areas and global talent pools and

routines for managing global staffing flows are introduced as key organizational

routines that can maximize the contribution of global mobility to the MNE. The paper

also considers challenges and opportunities for the integration of mobility and talent

and outlines some directions for future study.

Key Words

Global talent management, global mobility, expatriation, inpatriation, talent pool,

human capital theory, social capital theory.

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Introduction

The centrality of global talent management (GTM) to the achievement of

multinational enterprises’ (MNEs) strategic objectives has become widely

acknowledged in recent years (Scullion, Collings and Caligiuri, 2010; Stahl et al,

2012; Tarique and Schuler, 2010). Emerging empirical insights highlight the

importance of international employee mobility as a key element of MNE’s global

talent strategies (McDonnell et al, 2010; Sparrow, 2007; Stahl et al, 2012). Upper-

echelons research provides empirical support for the positive relationship between

top-management team (TMT) international assignment experience and indicators of

firm performance (Carpenter, Sanders and Gregersen, 2001), and levels of

international diversification (Tihanyi, Ellstrand, Daily and Dalton, 2000). Similarly,

the use of parent-country national (PCN) expatriates to staff subsidiary operations has

been shown to improve subsidiary labour productivity, particularly in new operations

in culturally distant locations (Gong, 2003). An emerging body of literature also

points to the strategic benefits of employee transfers from subsidiary operations to the

corporate HQ (inpatriates) (Reiche, 2012). These studies point to the importance of

international experience of organisational leaders on the strategic direction of their

firms and its impact on firm performance, and provide an evidence-based logic for the

connection between global mobility and global talent management in MNEs. Indeed,

in some MNEs being open to international job rotations is a condition of being a

member of the organization’s leadership talent pool (Hall, Zhu and Yan, 2001).

However, the academic literature has largely been silent on the integration

between global mobility and global talent management (GTM). This is a significant

gap, as organisations have little theoretical or empirical guidance on how to maximise

the integration of global mobility and global talent management and how to maximise

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the contribution of global mobility to organisational performance. This paper aims to

begin a dialog around the integration of global talent management and global

mobility. The paper draws upon human capital and social capital theories to integrate

these areas of practice and provide a theoretical point of departure for future study in

this important area. A central argument in the paper is that global mobility as a

function needs to move from an overly transactional focus on compliance and tax

issues, to a more strategic focus that ensures the organisation can effectively deliver

its global talent strategy.

Structurally the paper begins by introducing the areas of GTM and global

mobility. The different functions of global mobility and their alignment with the

MNE’s GTM strategy will then be explored, and human capital and social capital

theories introduced as theoretical frames for considering the integration of the areas.

Finally, some challenges and opportunities in integrating the GTM and global

mobility functions in organisations are outlined.

Global Talent Management:

While acknowledging that debate continues around the conceptual boundaries

of global talent management, there are a number of principal elements of GTM that

are identifiable. Firstly, GTM systems are generally focused on the management of

high-potential and high-performing employees, or those with high levels of human

capital, across the organization (Stahl et al, 2012). Second, GTM is focused on

human resource (HR) practices aimed at attracting, developing, and retaining those

individuals with high levels of human capital aligned with the organization’s strategic

intent (Scullion et al, 2010; Tarique and Schuler, 2010). Thirdly, organizations

globally continue to struggle to source the quality and quantity of global talent that

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they require to operative effectively in the global context (Hartmann, Fiesel and

Schober, 2010; Farndale, Scullion and Sparrow, 2010). Finally, GTM is argued to

have brought issues around human capital to the agenda of the corporate top

management team to a far greater degree than has been the case in the past (Scullion

et al, 2010). For example, a study of CEOs conducted by Cornell University found

that metrics around talent and leadership were those most demanded of Chief Human

Resource Officers by CEOs (Wright et al, 2012).

For the purposes of the current paper, I adopt Mellahi and Collings’s (2010:

143) definition of GTM as involving: (1) the systematic identification of key positions

that differentially contribute to the organization’s sustainable competitive advantage

on a global scale; (2) the development of a talent pool of high-potential and high-

performing incumbents, who reflect the global scope of the MNE to fill these roles;

and (3) the development of a differentiated human resource architecture to facilitate

filling these positions with the best available incumbents in order to ensure their

continued commitment to the organization.

This definition has a number of important implications for unpacking the

relationship between global mobility and global talent management. Firstly, it

acknowledges that talent management is not limited to leadership positions and that

there are other pivotal positions (Boudreau and Ramstad, 2007; Collings and Mellahi,

2009; Becker and Huselid, 2010) that disproportionately contribute to the

organization’s sustainable competitive advantage. The filling of these positions may

also be covered by an organization’s global talent management system. Second,

building a talent pool of high-performing and high-potential incumbents that “reflects

the global scope of the MNE” reflects the importance of staffing flows beyond the

traditional ethnocentric flow of parent-country national (PCN) expatriates from HQ to

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subsidiaries. Thus, the consideration of third-country national expatriates and

inpatriates also emerge as important elements of the global talent strategy (Collings et

al, 2010; Harvey et al, 2000; Reiche, 2012). These staffing options are often ignored

in the global mobility literature (c.f. Harvey and Buckley, 1997; Harvey et al, 1999).

Finally, the development of a differentiated HR architecture to support the

deployment and retention of these talents requires organizations to carefully balance

initiatives to reduce the costs of expatriate assignments with ensuring the ongoing

commitment and performance of such employees (see for example Tait, DeCieri and

McNulty’s, 2014 critique on the opportunity cost of the monetary savings of

permanent transfers). I now consider some central issues around global mobility.

Global Mobility in the MNE

Global mobility represents an important element of the global staffing system

of the contemporary MNE. Although the landscape of global mobility has altered

significantly over recent decades (see Collings, Scullion and Morley, 2007), global

mobility remains a central element of the GTM strategies of leading MNEs (Stahl et

al, 2012; Brookfield GMAC, 2013; E&Y, 2012). However, the topography is

complex, with the contemporary MNEs relying on a range of staffing options to fulfil

business needs. For example, permanent transfers, international business travel,

commuter and rotational assignments as well traditional long-term assignments

(generally 3-5 years) and short-term assignments (longer than a business trip but less

than a year) all represent important elements of an organization’s global mobility

strategies (Collings et al, 2007). For the current paper, I focus on corporate

expatriates - “employees who are temporarily relocated by their organizations to

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another country…to complete a specific task or accomplish an organizational goal1”

(Shaffer, Kraimer, Chan and Bolino, 2012: 1287).

The differing objectives of international assignments have long been

recognised and have significant implications for how we think about the integration

between global mobility and global talent management. Over 35 years ago Edstrom

and Gilbraith (1977) outlined three objectives of international assignments as position

filling, where suitably qualified local talent was unavailable; to facilitate the

development of individual employees; and as a means of organisational development

with a focus on the transfer of knowledge between subsidiaries and to sustain and

modify the organizational structure and decision processes. More recently, Black et al

(1999) argued that the use of international assignments had become more strategic.

This strategic perspective emphasises the use of international assignments for

succession planning and leadership development; in coordination and control; and in

information exchange around the multinational network. Recognising these

differences is important in evaluating the outcomes of international assignments

(IAs), and linking global mobility and global talent. For example, empirical research

has confirmed that assignments premised on management development foster

personal change and role innovation as the assignee adapts his or her frame of

reference in acclimatizing to the new environment. This perhaps explains why

developmental assignments appear to have greater career-enhancing effects than other

forms of assignment (Kraimer, Shaffer & Bolino, 2009: 42; Stahl et al, 2009).

                                                                                                               1  Shaffer  et  al  prioritise  assignments  lasting  several  years  in  their  definition.  Given  the  incorporation  of  short-­‐term  assignments  in  the  present  discussion,  I  recognise  the  importance  of  such  shorter-­‐duration  assignments.  This  definition  also  excludes  self-­‐initiated  expatriates  -­‐  those  individuals  who  relocate  internationally  in  search  of  work  without  the  support  of  an  employer.  Although  these  employees  clearly  represent  an  important  source  of  global  talent,  they  are  not  generally  managed  by  the  global  mobility  function,  and  hence  fall  beyond  the  scope  of  the  current  discussion.  For  a  discussion  of  these  and  other  staffing  options  see  Al  Ariss  and  Crowley-­‐Henry,  2013;  Fang  et  al,  2013).  

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Alternatively, in control-driven assignments, locals are expected to absorb the

new demands of the expatriate manager and change their frames of reference (Shay &

Baack, 2004). However the differing objectives of global mobility also point to

potential differences in how the assignees are managed from a HR perspective. For

example, an assignee deployed for position filling may require significant support in

the softer skills required to adjust to the host country and to transfer his or her

knowledge to the host employees, as there is often a strong teaching focus in selecting

for these roles (Evans, Pucik, and Barsoux, 2002). In contrast, support for those

selected for developmental assignments should focus on assimilating learning

opportunities from the host country and facilitating the application of this knowledge

on repatriation. Further, Dickmann & Doherty (2010) argue that, those sent on

developmental assignments are more inclined to leave their organizations, arguing

this is related to better career opportunities available to them in the external labor

market, and pointing to the particular influence of commitment-oriented and/or

retention-oriented HR policies.

Additionally, unpacking the various objectives of global mobility has

important implications as organizations begin to consider the return on investment

(ROI) on such assignments. Following McNulty and Tharenou (2004: 73), I define

expatriate ROI as ‘a calculation in which the financial and non-financial benefits to

the firm are compared with the financial and non-financial costs of the international

assignment, as appropriate to the assignment’s purpose’. However, the measurement

of the ROI of international assignments has been something that MNEs have been

grappling with, largely unsuccessfully, for some time. McNulty DeCieri and

Hutchings, (2009) surmise the challenges in so doing owe to a number of difficulties,

including inappropriate decision frameworks that can retard the development of

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effective measures that are linked to global staffing decisions (Boudreau & Ramstad,

2007), and a failure to plan operationally for the measurement of international

assignee performance and its resultant contribution to unit or organizational

performance indicators (Scullion & Collings, 2006). The recognition of the differing

objectives of global mobility necessitates a far more complex consideration of issues

around time frame for calculation of ROI and the incorporation of non-financial

benefits and costs (McNulty et al, 2009). Given that many of the challenges identified

around the tracking of ROI are traced to a lack of reliable data, the emergence of

talent analytics as a primary area of focus in the wider talent-management literature

(Cascio and Boudreau, 2011; Davenport et al, 2010; Vaiman et al, 2012) may assist

organizations in improving their measurement of ROI issues in the context of global

mobility.

I now consider the linkages of particular objectives of global mobility in the

context of GTM.

Global mobility as leadership development and succession planning

The use of global mobility as a means of global leadership development,

linked with succession planning (Black et al, 1999; Edstrom and Gilbraith, 1977), has

arguably been the most commonly discussed outcome of global mobility. Indeed, over

recent decades a key constraint on the ability of MNEs to compete globally has been

the challenge of persuading the requisite quality and quantity of suitable employees to

undertake international assignments, which has contributed to a lack of global

leadership competence in MNEs (Brookfield GMAC, 2013). However, some

emerging empirical evidence points to the increasing willingness of those who are

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aware that they are part of the MNE’s talent pool to undertake developmental

activities such as international assignments (see for example Bjorkman et al, 2013;

Makela and Bjorkman, 2013).

International assignments focused on individual development are premised on

the expectation that culturally intense experiences, such as international assignments,

develop individuals more holistically by exposing them to the challenges of living and

working in a foreign country (Leung, Maddux, Galinsky, & Chiu, 2008). The limited

available empirical evidence points to the importance of high-contact, cross-cultural

leadership-development experiences combined with the leader’s personality

characteristics in determining global leaders’ effectiveness (Caligiuri and Tarique,

2009). Research points to the importance of overcoming challenging and complex

issues and problems in novel and high-pressure situations, the requirement to work in

complex and highly-uncertainty conditions, and the need to lead and influence

colleagues and other stakeholders with diverse mindsets, ambitions and goals as

important drivers of on-the-job learning (Evans et al., 2002; McCall and Hollenbeck,

2002; Ng, Van Dyne, and Ang, 2009).

However, in evaluating the success of international assignments premised on

developmental objectives, one should broaden the focus from purely work

effectiveness and recognize the importance of learning effectiveness (Ng et al, 2009).

It is equally important to recognize that failures on assignment can also constitute

important learning events (Hall et al, 2001). More broadly, the development of social

capital has been identified as an important outcome of developmental international

assignments.

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Global mobility as organization development, co-ordination and control

Under this category I include Black et al’s (1999) broader categories of

information exchange and coordination and control. Thus IAs captured under this

heading represent a broad range of assignments. It is recognized that international

assignments represent important means of leveraging internal knowledge and

innovation, which, in turn, facilitate the MNE in capturing the competitive advantage

emerging from worldwide access to information, learning and creativity. The capacity

to identify such innovations within the organisational network and to transfer them

globally is considered central to the competitiveness of MNEs (Edwards, et al., 2006).

For Gammelgaard et al., (2004) the very success of MNEs is contingent upon the ease

and speed with such knowledge is disseminated throughout the firm.

This type of assignment is also associated with organisational control and

corporate integration (Harzing, 2001). In this regard, corporate integration is defined

as “centralized control over key resources and operations that are strategic in the

value chain” (Evans et al, 2002: 103). Two factors contribute to the increasing desire

to integrate HRM policies in MNEs - the growing focus on creating social capital

throughout the MNE’s global internal network, and the increasing emphasis on

ensuring the sustainability of MNE’s global operations (Taylor, 2006). Global

integration, in turn, facilitates the development of a common corporate culture and

has the potential to enhance equity and procedural justice within the MNE through the

transfer of organizational practices (Rosenzweig and Nohria, 1994).

Exploring the issue from a control perspective, Harzing (2001) identified three

control-specific roles of expatriates, namely: the bear, the bumblebee, and the spider.

The Bear focus on replication of corporate practices and the centralisation of

decision-making in the MNE. Bumblebees develop corporate integration through

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building informal communication networks around the MNE’s network and the

socialisation of host-country employees. Finally, spiders weave informal

communication networks within the MNE. Harzing’s typology reinforces the

importance of social capital in building corporate integration (I return to this below).

Global mobility as position filling

While leadership talent has received the greatest amount of discussion in the

global talent-management literature, the reality for most organizations is that there are

positions that are as important, if not more important, than leadership ones in

determining the success or failure of the organization. Indeed, an important

advancement of the talent-management literature is a better understanding of

positions that have the greatest potential to add value to the organization (Boudreau

and Ramstad, 2007; Becker et al, 2009; Cascio & Boudreau, 2011). This approach is

consistent with calls for a greater level of differentiation between roles in

organisations, with an emphasis on strategic over non-strategic jobs (Becker and

Huselid, 2010), or between those organizational roles that promise only marginal

impact vis-à-vis those that can provide above-average impact (Boudreau and Ramstad

2007).

Strategic jobs make “a disproportionate contribution to the effective

implementation of a strategic capability” (Becker and Huselid, 2010: 381).

Recognising that such roles can emerge at any level in the organisational hierarchy,

such roles are characterized by rarity (generally fewer than 15 per cent of the roles in

the organisation), strategic impact (they display a direct impact on the firm’s ability to

execute its strategy though its strategic capability) and, most significantly, there is

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potential for incumbent performance variability (i.e. there is an evident gap in

performance between high performers and average performers in these roles) (Becker

and Huselid, 2010). As such, these strategic jobs are central to a MNE’s GTM system.

Thus while not all international assignments captured under the heading of

position filling should be considered in the organization’s GTM system, it is likely

that a number of them will be and it is important for the global mobility function to be

able to identify these positions.

Integration of Global Mobility and Global Talent Management

In building a theoretical basis to consider the integration of global mobility

and global talent management, I draw on human capital theory and social capital

theory as theoretical frames to elucidate the impact of integrating global talent

management and global mobility with a focus on organisational-level outcomes. Both

human capital and social capital have been empirically linked with firm performance

in other contexts (Pil and Leana, 2009).

As alluded to above, many MNEs struggle to quantify the contributions that

international assignees make to organisational performance. This is reflected in the

challenges that they face in measuring the ROI of such assignments. Theoretically,

human capital theory provides a frame for the consideration of these linkages.

Following Kang et al (2007), I define human capital as the value-generating potential

of employee knowledge, skills and abilities. Human capital is thus explicitly linked

with change and growth, distinguishing it from other resources (Kraaijenbrink, 2011).

Variations in firms’ human capital have been empirically linked to contributions to

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organizational performance (see Crook et al, 2011; Hitt et al, 2001; Wright and

McMahan, 2011). Early contributors, such as Becker (1964), concluded that

individual earnings were largely an outcome of how much workers invested in

developing their skills and knowledge. Thus, individuals with higher levels of human

capital can perform at a higher level in organisations. The potential value of human

capital increases with job complexity, with higher performance in complex jobs

associated with greater differences in human capital (Hunter et al, 1990).

However human capital is fundamentally an individual asset, with its value

for the firm contingent on a wider range of social factors (Nahapiet, 2011). The

embodiment of human capital in individual employees brings agency issues, such as

intentionality and motivation, to the fore in considering its impact in an organizational

context (Kraaijenbrink, 2011). Indeed, a key challenge for organizations in managing

human capital is the risk that employees can leave of their own free will, as the

individual, and not the firm, owns the human capital. Thus, an important distinction in

the human capital literature is between general (such as education) and firm-specific

(knowledge of process and systems, support team, reputation etc.) human capital.

Becker (1964) argued that general human capital can be traded in competitive labor

markets, bidding up the price of labor. This raises a question around the extent to

which generic human capital can generate competitive advantage for a firm. For

example, drawing on a significant body of research, Groysberg (2010) has concluded

that even in professions where performance is considered to be highly determined by

the individual, such as Wall Street analysts, the reality is that firm-specific human

capital is far more significant in explaining performance than individual-level human

capital. This is reflected in significant drops in performance amongst those stars

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when the changed employers and the value of the firm-specific human capital was

lost.

However human capital cannot be considered in isolation, and social capital

has been proposed as central to maximizing the benefits from a firm’s human capital,

owing to the social ties underlying it, which constitute a valuable resource for

facilitating organizational effectiveness (Nahapiet, 2011). Although there is debate

over the definition of social capital, a widely adopted definition is ‘the sum of the

actual and potential resources embedded within, available through, and derived from

the network of relationships possessed by an individual or social unit. Social capital

comprises the network and the assets that may be mobilized though that network’

(Nahapiet and Ghoshal, 1998: 243). Lengnick-Hall and Lengnick-Hall (2012) point to

three key ways in which social capital can facilitate organization effectiveness: 1. As

a form of social control; 2. as a support network for employees; and 3. providing

access to information and other assets, such as political insights.

Expanding the definition of social capital, Nahapiet and Ghoshal (1998)

identify three types of social capital. Structural social capital is centered on the

number of and strength of ties an individual has and can draw upon, and is thus based

on an individual’s network of contacts. In the multinational context it contributes to

the flow of knowledge and coordination by spanning sub-units or networks in the

MNE’s global operations (Kostova and Roth, 2003). Relational social capital focuses

on the nature of personal relationships developed over time, and it brings trust to the

fore. It is considered more of a public good and nurtures the willingness to share

knowledge with spatially distant colleagues. Finally, cognitive social capital focuses

on the shared goals, norms and values that are built though relationships over time

(Inkpen and Tsang, 2005). Also considered a public good, this is central to the

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development of a common vision and culture in the MNE through the creation of a

shared frame of reference and norms (Lengnick-Hall and Lengnick-Hall, 2012;

Nahapiet and Ghoshal, 1998; Taylor, 2007).

Empirical research suggests that managers who have undertaken expatriate

assignments possess significantly more social capital than managers with solely

domestic experience (Makela, 2007). Similarly, expatriate/repatriate interaction

contexts are associated with more interpersonal trust and shared cognitive ground,

resulting in higher levels of knowledge sharing (Makela and Brewster, 2009).

Emerging evidence confirms that alternative forms of global mobility, such as short-

term assignments, facilitate the development of cross-unit social ties in MNEs

(Bozkurt and Mohr, 2011). However, such ties are weaker than those developed

through traditional long-term assignments (Bozkurt and Mohr, 2011). The role of

inpatriate assignees as knowledge conduits has also been demonstrated (Reiche,

2011), with their cross-unit boundary-spanning central to their knowledge transfer.

It is important to note that social capital is not always a universally positive

resource in organizations. For example strong ties within networks can result in the

exclusion of outsiders from networks and create blind-spots, thus preventing the

consideration of new ideas (see Lengnick-Hall and Lenngnick-Hall, 2012: 493).

Additionally, individuals on international assignments can see the erosion of social

capital at their home units (out-of-sight out-of-mind syndrome) (Makela, 2007).

Further, Oldroyd and Morris (2012) have pointed to the potential overload that star

employees may face as colleagues attempt to tap into their expertise, leading to a fall

in the star’s performance.

The importance of routines

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A logical progression from the above discussion is the importance of having

systems and processes to support the organization’s human and social capital

advantage. As Boxall (2011: 298) notes, it is useful to think of the HR strategy within

firms as a cluster of HR systems, each concerned with work organization and human

resource practices of a particular group. Integrated clusters of HR practices should

support the MNE’s global talent that includes both those in strategic jobs (operational

and control-oriented) (Becker and Hueslid, 2010), and the current and future

leadership cohorts within the global firm. A central argument in the current paper is

that the global talent function (Farndale et al, 2010) and the global mobility function

(Sparrow, 2012) should work together to effectively manage these pivotal employee

groups.

The dynamic-capabilities perspective argues that routines can be effective in

reconfiguring intangible assets such as human and social capital, in ways that

facilitate the renewability, augmentation and creative responses to dynamic and

unpredictable business conditions (Teece et al, 1997). Such organizational routines -

repetitive, recognizable patterns of interdependent actions involving various actors

through which work is accomplished in organizations - have been proposed as a key

means of guiding organizational activity, creating stability and boosting efficiencies

in organizations (Feldman and Pentland, 2003; Gupta and Govindarajan, 2002; Ng et

al, 2011: 105). I propose two organizational routines that are central to the strategic

integration of global talent management and global mobility in the MNE. While

recognizing there are many other relevant organization routines (see Ng et al, 2011),

space restrictions mean a thorough discussion of numerous routines is beyond the

scope of the current paper. Rather the two routines are presented to illustrate how

scholars and practitioners can frame such routines in theoretical terms to advance

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their thinking on the integrations between global mobility and global talent

management in the MNE context.

Routines for identifying and managing global talent: A global talent-pool routine

To effectively manage global talent MNEs must have effective systems and

processes to identify the highest-performing and highest-potential employees across

the global firm. While the challenges of so doing are well recognised (Makela et al,

2010; Mellahi and Collings, 2010; Minbaeva and Collings, 2013), I propose that a

global talent-pool strategy addresses a number of challenges of effectively managing

human capital in the MNE.

The first advantage of global talent pools is that they advance organizational

practice from demand-led recruitment to recruitment ‘ahead of the curve’ (Sparrow,

2007). This is significant, as the path-dependent effect of human capital development

has been recognised since Penrose’s (1959) contribution. She demonstrated how

managerial efforts to expand organizations were constrained, owing to the time

required to develop the managerial talent. Thus there is a temporal element to the

impact of human capital and performance, and those organizations that invest in the

development of human capital ‘ahead of the curve’ are likely to display higher

performance levels. This is in line with developments in the theory of human capital,

which reflect a shift from ‘static’ or ‘stock’ notions of human capital towards ‘flow’

or ‘process’ notions of human capital (Buron-Jones and Spender, 2011). It

acknowledges that the business environment is constantly in flux, and that static

conceptualisations of human capital requirements are no longer effective (Cascio and

Aguinis, 2008; Cappelli, 2008; Lepak et al, 2011). The potential impact of the future

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value of human capital beyond its present value is also brought to the fore (Lepak et

al, 2011).

The global talent-pool strategy thus places the emphasis on the proactive

identification of incumbents with the potential to fill key positions as they become

available. Drawing on supply-chain management, Cappelli (2008: 77) argues: “how

employees advance through development jobs and experiences are remarkably similar

to how products move through a supply chain”. Cappelli advocates a talent-pool

strategy as a means of managing the risks of mis-matches between talent supply and

demand. It also facilitates the career-pathing of the organization’s global talent. In

organizations where global mobility and global talent are integrated, one would

expect a higher level of presence of international assignees in pivotal roles around the

MNE network. Hence the movement of global talent around the MNE will be more

likely to be considered central to the strategic objectives of the MNE. This leads to

the following proposition

P1: A talent-pool strategy combined with a high level of integration

between the global mobility and global talent functions, will be reflected in higher

levels of expatriate presence in pivotal roles across the MNE.

Human capital research has also highlighted that human capital

accumulation is most valuable when retained in the context where it is developed

(Coff, 2001; Hitt et al, 2001). However, the challenges of sustaining the performance

level of high-performing employees when they change contexts (for example,

organizations) has also been empirically demonstrated (Groysberg et al, 2008).

Ceteris paribus, this points to the value of talent pools in terms of building an internal

pipeline of human capital vis-à-vis the buying of human capital from the external

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labour market. Although the latter may be preferable in some circumstances, such as

a change in strategic direction of the organisation, or when key skills are required

quickly and on short notice, in most circumstances internal development is preferable.

It could also be reflected in the spatial distribution of the global talent pool and the

requirements of global mobility to align talent requirements with available human

capital. An additional benefit of a talent-pool strategy is that the focus can be on the

development of talent within the broader context of the organisation, rather than with

a particular succession role in mind (Collings and Mellahi, 2009). This means that

rather than developing talent in narrow, specialised ways, employees can be

developed more broadly, targeting competencies that would fit a range of roles

(Cappelli, 2008) and reflecting the values of the organization. It also facilitates the

building of social capital across the multinational network that facilitates knowledge

creation and exchange, as well as coordination and control (Taylor, 2007). This has

the benefit of focusing on firm-specific human capital, which is less transferrable and

may assist in the retention of pivotal talent. From a global mobility perspective, the

key is to facilitate the deployment of the global talent pool in appropriate international

roles, and to ensure that an appropriate support package is in place for each

assignment.

This approach stands in contrast to extant practice with regard to expatriate

deployment in many MNEs. For example, the fact that expatriate selection is largely

ad-hoc and reactive is relatively well established in the literature (see Harris and

Brewster, 1999; Tahvanainen et al, 2005). A talent-pool approach, where global

mobility and talent are integrated, facilitates a more strategic approach to expatriate

deployment. Because these assignees have displayed higher levels of performance and

potential and possess high levels of firm-specific human capital, and social capital as

  21  

well, the early involvement of global mobility should facilitate appropriate selection

and support. As a result, one would expect higher levels of performance on

assignment. This leads to the following proposition.

P2: The performance of international assignees on assignment will be

higher in organizations that adopt a global talent-pool strategy, and where global

mobility and global talent functions are integrated.

Finally, given that a global talent pool combined with the identification of

strategic roles facilitates the deployment of those with the highest levels of human

capital, and particularly of firm-specific human capital, in those roles that are central

to organization strategy and have the greatest variability in performance between high

performing and average performers, it is likely to translate into higher levels of

organization performance.

P3: Integration between the global mobility and global talent functions,

combined with a global talent-pool strategy, will result in higher levels of

organizational performance.

Routines for managing global staffing flows

The second organizational routine that I focus on concerns the managing of

global staffing flows around the MNE. Ng et al (2011) have identified routines for

managing personnel flows globally as a significant means of promoting knowledge

transfer across subsidiaries. In the context of global talent management, global

staffing flows represent an important means of aligning those members of the global

  22  

talent pool with pivotal roles across the MNE’s global network. Central to such an

approach is moving beyond traditional ethnocentric conceptualisation of PCN

expatriates as superior talent, relative to local talent, who could additionally be

relocated as inpatriates or TCN expatriates (Collings et al, 2010; Ng et al, 2011). As

Cascio and Aguinis (2007) note, the successful MNE of the future will be required to

source human and intellectual resources regardless of their global location, owing to

the increasing competition. Indeed, a central source of competitive advantage for the

MNE is the capacity to tap into different pools of human capital expertise in the

different locations in which it operates (see O’Riain, 2011 for a discussion of human-

capital formation regimes). Such an approach is consistent with Perlmutter’s

geocentric recruitment strategy (see, for example, Dowling, Festing, & Engle, 2009,

pp. 82-83). This facilitates the most effective use of global talent and provides a basis

for higher-level organization performance.

Routines of managing global staffing flows have received relatively limited

attention in the extant literature (cf. Farndale et al, 2010; Makela and Brewster, 2009;

Sparrow, 2012). Farndale et al (2010) point to the role that the global HR function can

play in the career management of international employees, in their typology of roles

of the global mobility function. In line with the argumentation in the current paper,

Farndale and colleagues posit that corporate HR has a unique perspective on the

nature of human capital availability in the MNE and is uniquely placed to manage

talent flows globally. However, there is little evidence that such strategic oversight is

widely evident in many corporate HR or global mobility functions, with a

transactional and compliance focus far more common. The available empirical

evidence points to the significance of corporate structures and systems in facilitating

staffing flows from subsidiary operations to the corporate headquarters and other

  23  

subsidiaries (Collings et al, 2010). This reinforces the importance of routines or

processes for the management of human capital. For example, Collings et al.’s (2010)

study identified the significance of HR systems (organizational process advantage) in

explaining flows of inpatriates and TCNs from the subsidiary to the HQ and other

subsidiaries respectively. Specific HR processes or routines that emerged as

significant in their study included global succession-planning systems, HR

information systems, and the presence of a local representative on the global HR

policy-formulation body. These organizational routines appear to mitigate to a degree

the challenges that subsidiary talent face in gaining attention from corporate HQ (see

also Torbiorn, 2005). This leads to the following proposition.

P4: HR systems targeted at identifying talent globally, such as global succession

planning, HR information systems, and global HR policy bodies, will be positively

correlated with international diversity in the membership of the global talent pool.

A further challenge for the MNEs is how current human capital can be

managed to maximise future value for the firm. Insights from the knowledge literature

(Crossan et al, 1999; March, 1991) point to the role of both exploitation (refining

extant knowledge and skills) and exploration (the development of alternative

knowledge and skills) in the renewal of human capital. For example, a central

challenge for a MNE in terms of future requirement of human capital concerns the

future scope of the organization in the geographic reach of the business. For many

MNEs this will mean expansion of business operations in emerging economies, such

as the BRICs (Brazil, Russia, India and China) and MISTs (Mexico, Indonesia, South

Korea and Turkey). These economies present demand for human capital with the

capability to operate effectively in such culturally and geographically distant markets

(Scullion et al, 2007; Tarique and Schuler, 2010), and social capital to tap into local

  24  

institutions and networks. However such competencies are in short supply and

demand far exceeds the supply (Tarique and Schuler, 2010). I argue that those

organizations that proactively identify talent from emerging markets will be more

likely to establish and sustain successful operations in new markets and countries in

which they had not traditionally operated, owing to the local knowledge and social

networks that the local employees bring to the MNE. Additionally this talent has the

potential to assume leadership roles in these markets. This leads to the following

proposition.

P5: MNEs with more diversified global talent pools, reflected in membership

that reflects the geographic spread of the MNE, will display higher levels of

international diversification in operations.

Discussion and Conclusions

Global talent management has become a key area of focus for practitioners

and academics alike over recent decades. Although the field remains relatively young

in its development, it has advanced significantly over the past decade or so. However

notwithstanding the clear overlap between global talent management and global

mobility, they have remained largely decoupled as areas of practice (E&Y, 2012), and

in academic theorizing on global talent management.

This paper provides a point of departure for the development of academic

theorizing around the integration of global mobility and global talent management.

Central to building a greater degree of integration between the two is the development

of appropriate theoretical frames to empirically study the relationships. The current

  25  

paper has introduced human capital, social capital and dynamic capabilities as

suitable theories that could be utilized in this regard. There are, of course, many

others, which scholars could draw upon to build the theoretical foundations of this

area of study. Appropriately framing the area theoretically represents an important

point of departure for the future study of these important areas. Conceptual clarity

represents a second primary concern for scholars in this area. For example, differing,

types (PCN, TCNs and inpatriates), durations (short-term versus long-term), and

objectives (developmental versus corporate integration versus strategic jobs) of

assignments should be recognized in developing hypotheses, measures, and outcome

variables for research in the area. This stands in contrast to much of the extant

research on global mobility, which limits itself to dichotomous considerations of host-

country national versus parent-country national staffing options owing to theoretical

and empirical convenience (Collings et al, 2009). Further, innovative methodologies

with longitudinal and/or multilevel designs provide the greatest potential for

advancement of the field. This is particularly salient given the relatively long

timeframe over which the objectives of many international assignments are achieved

and are measureable (McNulty et al, 1999). Finally, innovative outcome variables

provide the potential for maximizing the impact of studies on global mobility and

global talent. Just as strategic HRM research has been highly influential, owing to the

outcome variables utilized, which focus on the contribution of high-performance work

systems or practices to organizational performance, studies of global talent

management and global mobility that measure multilevel outcome variables linked to

individual and organizational performance outcomes have the potential to maximize

the impact of research on academic and practitioner audiences alike.

  26  

Managerial Relevance

Given the well-established rationales for expatriate deployment (Edstrom

and Gilbraith, 1977; Black et al.1999), it is clear that many of the reasons for

expatriate deployment are clearly aligned with pivotal strategic roles within the MNE.

These include strategic jobs, control and integration, and leadership development. I

now outline some of the primary challenges in developing the strategic impact of

global mobility and in developing the integration between global mobility and global

talnet.

Historically a key constraint on the strategic contribution of the global mobility

function has been the overriding focus on tax and compliance issues within the

function. For example a recent practitioner study (E&Y, 2012) identified tax

compliance and immigration as the two priorities of the global mobility function. This

points to the transactional, downstream focus that has historically dominated the

orientation of the global mobility function. Such a focus is understandable given the

potential for legal, financial and reputational damage should an organization fail to

manage such tax and immigration issues appropriately. However, the same report

points to the global mobility function’s aspiration to position itself more strategically,

to build tighter links with talent development, and to have greater control over cost

and risk governance. However there is little evidence that this is occurring in the vast

majority of organizations.

I argue that a point of departure in integrating global mobility and global

talent management is the increased involvement of global mobility function in

upstream decisions around global staffing in the MNE. I propose that one means

through which the global mobility function can increase its visibility and status in the

  27  

MNE is through the development of key metrics that begin to demonstrate the

strategic value of global mobility within the MNE. For example, it is well established

that many MNEs struggle with high levels of voluntary turnover of repatriates on

completion of their assignments (Lazarova and Cerdin, 2007). Given that many of

these assignees are members of the MNE’s global talent pool, and their international

assignment has often been part of a significant investment in their development, their

voluntary turnover is a strategic issue for the MNE (see Cascio & Boudreau, 2011:

84-5). However, there is little evidence that many global mobility functions have

developed models to effectively track the cost of this voluntary turnover. Such

analyses could be used to build a strategic case for earlier involvement of the function

in the staffing process and to invest in better supports for expatriates and their

families (see Cascio & Boudreau, 2011: chapter 4 for a discussion of costing

turnover).

A second constraint on the integration of global mobility with global talent

management is that global mobility is not involved in the process at an early enough

stage in the expatriate assignment cycle. For example, it is well established that

selection of international assignees for both traditional long-term assignments (Harris

and Brewster, 1999) and short-term assignments (Tahvanainen, Welch, and Worm,

2005) is ad hoc and informal. In effect the formal recruitment and selection processes

simply reinforce and legitimize selection decisions that have already been informally

made. Such decisions are generally made on the basis of domestic performance and

technical competence- which are considered poor indicators of performance when on

assignment. This reflects a reactive rather than a strategic approach to the

management of expatriation (Harzing, 2004), and makes the alignment between

global mobility and global talent management particularly challenging. In advancing

  28  

the integration of global mobility and GTM it is imperative that global mobility and

GTM functions work together to ensure alignment between selection for international

assignments. individualized career paths, and the overall GTM strategy wherever

appropriate and possible. Further, the earlier intervention of the global mobility

function in to the international assignment process in imperative.

A final illustrative challenge to the integration of global mobility and global

talent management relates to development of an appropriate HR architecture to

support the globally mobile population. Given the heavy emphasis on reducing the

costs of international assignments over recent decades (Brookfield GMAC, 2013;

Collings et al, 2007) we now see a significant percentage (41%) of global mobility

functions reporting to compensation and benefits or rewards, reinforcing the emphasis

on cost control (Forum for Expatriate Management, 2010). The fact that only 7 per

cent of functions in the same survey reported to talent management is also telling.

Given the strong role that HR practices play in clarifying signals about expected

behaviors from employees, and, equally, of signaling the organization’s support of

their careers (Bowen and Ostroff, 2004), managed effectively, a congruent set of HR

practices should help maximize employee performance while on assignment and

minimize turnover levels on repatriation. However, as noted above, not all

international assignees will be members of the global talent pool, and clearly the HR

support appropriate for these employees may be less than for those who are in the

talent pool. However for pivotal talent, I propose the key is a highly integrated and

congruent HR architecture that supports them throughout and beyond the HR cycle.

This begins with effective career planning, and includes appropriate pre-departure

training, support for the assignee and his or her family, effective repatriation support,

  29  

and career support post repatriation (see Collings et al, 2010). The development of

effective metrics and measurement again appears central to building the case for

effective investment in appropriate HR supports for the global mobility function and

for the international assignees it supports.

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